July 19, 1978
Page 21623
Mr. MUSKIE. I have listened with interest to all this talk about cutting back.
Mr. BROOKE. Yes.
Mr. MUSKIE. May I remind the Senator that the amounts provided in the budget resolution were adopted by the Senate in May without any amendment being offered on the floor?
The Budget Committee acted on the basis of the President's recommendations in January and the recommendations of the committee in March. We made our recommendation fully funding the President's recommendation. No amendment was offered on the floor. The House of Representatives, responding to the same information, adopted the same number, and the issue was not even in conference. There was no issue.
No one argued then that we were "cutting back" anything.
Mr. BROOKE. Will the Senator yield?
Mr. MUSKIE. As a matter of fact, the statement I have already given this afternoon indicates that we would continue adding 375,000 families a year, which is the present level.
We are not cutting one family. Just the opposite — we are adding many new families to a growing base of those already receiving housing assistance. Even at the higher cost of housing, we would be continuing to add 375,000 families a year, and we are projecting this through 1983 at a cost of $175 billion. And in that 5-year period, the percentage of the Federal budget devoted to assisted housing will grow by 50 percent, under the level projected in the budget resolution.
Yet I hear all this talk about how we have cut the budget for assisted housing.
Mr. BROOKE. Will the Senator yield?
Mr. MUSKIE. How we have ignored the poor, how we have ignored the elderly.
I reject that implication. You can always establish a larger need. There are a lot of needs that the Federal budget has to meet that are not going to be met totally by this budget, and the Senator knows that. I could go through them program after program, function after function, why we could not meet the total need as argued by Senators.
But now we hear, after all these months, that the first budget resolution represents cuts — when no question was raised earlier, without an amendment to the budget resolution being raised on the floor, without an issue between the two Houses in conference. I reject that argument.
I accept the notion that the housing problem is a grave problem in this country, even for the middle class, because of the displacements caused by inflation in housing costs. I do not contend that we meet the total need in this budget. But to contend, because we have not met the total need, that we have cut the budget is an argument, as I say, which I must reject.
Mr. BROOKE. Mr. President, the distinguished Senator from Maine certainly did not mean to say the total need, because the minimum need is 600,000 units, as we have already said.
Certainly that is not the total need.
The Senator served on the Banking Housing, and Urban Affairs Committee. He served on that committee when I was a member of the committee. So he is well aware of the housing needs of this country.
Everything is relative. You talk about cutting back to 375,000 units. But the reality is that the funding level you propose would not produce 375,000 units, it will only produce 360,000 units, which is below this year's level and below last year's level and below the level of the year before that.
Mr. MUSKIE. The figures we have are 375,000 additional households each year through 1983.
This is the first challenge of those figures that I have heard on the floor in connection with the budget resolution.
Mr. BROOKE. That has changed; 360,000 units, not 375,000 units.
Mr. MUSKIE. This is CBO's projection, 375,000, and it is the latest CBO projection. CBO is the agency we have created to give us these figures.
Mr. BROOKE. We have a change in assumptions from HUD which produced the 360,000-unit estimate. That is what we have.
Mr. MUSKIE. We created CBO to give us the latest information. I put in the RECORD earlier a letter from Secretary Harris supporting the President's request, which is fully funded by the first budget resolution. The Senator certainly has the prerogative of challenging the first budget resolution, as any Senator does, or to offer his own priorities. I do not challenge that. But my blood boils when I am told on July 19, after having considered this subject for all these months, with all the opportunities for everybody, including the Senator from Massachusetts, to correct my judgments on the floor of the Senate in connection with the first budget resolution, that we are cutting when all of the information is to the contrary. It does make my blood boil, and the Senator knows my blood boils easily.
Mr. BROOKE. I have been exposed to it before. I do know that. All I am saying is that when we talk about cutting back we are talking about cutting back from this year's funding level and the previous year's funding level. We are not talking about the budget resolution.
Mr. MUSKIE. We are not cutting according to the projections in the Congressional Budget Office. If the Senator wants to challenge those projections, that is his prerogative, but I have found CBO to be a very useful and reliable guide on these numbers. By their numbers we are not cutting back, and even with inflation raising the cost of housing units we are raising the dollars. So we raise the dollars to maintain the same numbers of units. These are CBO's numbers as of today. If we are going to use a variety of authorities for these numbers we are not ever going to agree on a budget.
Mr. BROOKE. The Senator is increasing the dollar amounts but the units cost more, as my distinguished colleague well knows.
Mr. MUSKIE. I have just said that the dollars we provided are more than last year in order to sustain the same number of units.
Mr. BROOKE. But there are fewer units that can be provided with that dollar figure. That is the point I am making.
Mr. MUSKIE. But CBO is saying the units are the same. If the Senate chooses to accept the Senator's 360,000 units instead of CBO's 375,000 units, that is fine. But I am simply telling the Senate that CBO's numbers are 375,000 and that is the same level as before. Where the Senator gets his 360,000 units I do not know, but I get my numbers from CBO and I am charged to get my numbers from CBO. We check with CBO constantly. I never come to the floor without checking with CBO on my numbers because I know they are subject to challenge if I do not. So those are the numbers. The Senator can reject them if he wishes.
Mr. BROOKE. It is not a matter of rejection. As I understand the numbers from HUD, in fiscal 1978 we will have 380,000 units; in fiscal 1977 there were 388,000 units, and under this amendment we would have 360,000 units. So that is 20,000 units less than 1978 and 28,000 units less than fiscal 1977. That is the record and that is correct.
Mr. MUSKIE. All I can say to the Senator is that from our experience in the past, CBO's numbers have been more accurate than HUD's. That was true under the previous administration as well as this one. CBO has developed an excellent capability for numbers so I rely on them. They are my right hand.
Mr. CHILES. I yield 2 minutes to Senator Proxmire.
Mr. PROXMIRE. I would like to reinforce what the distinguished Senator from Maine has said. Listening to the Senator from Massachusetts one gets the idea that we are so hard-hearted that we are cutting the program ruthlessly. We are accepting HUD's recommendation. This is what Secretary Harris is asking for and what President Carter is asking for. He has been criticized for having too big a budget. Everybody I have heard has said that $500 billion is too much. We are coming in at his level and, of course, at the level of the congressional resolution, which, the distinguished Senator from Maine pointed out properly, we adopted in May without any dissent.
Let me take a minute to point out the fact that we did adopt my amendment as our housing goal in 1968, 6 million housing starts over the decade. We never achieved that at all. We averaged less than 300,000 during the past 10-year period. So to argue that by coming in below 600,000 we are being cruel and unrealistic, and betraying what we have done in the past, simply is not the fact. The fact is that the administration's proposal is above what we have provided, on the average, during the last 10 years.
We also have to recognize, as Senator CHILES properly pointed out, that we are in a very inflationary period. We are in a period when housing starts have been well above the average. We are in a period when we must recognize that an increase could represent an inflationary element in our economy.
There are few events that are more inflationary than a sudden increase in housing. What the Senator from Florida is trying to do in his amendment is simply to maintain a steady, consistent pattern of assistance to housing rather than have the program go up and, as the Senator from Maine and the Senator from Florida have pointed out so well, to discredit the program in the long run.
Mr. CHILES. The Senator is absolutely correct, and he makes his point so well. The people who really suffer the most when we get into this kind of inflationary spiral that we are in right now are the very people we are talking about trying to assist. We know we cannot assist them all today or tomorrow or next year. There is no way of trying to do that so let us try to do something so that what we say we can do we can accomplish and we will not add the stop-start program again.
Further, that we are going to do it in a consistent way that the housing industry will know and be able to gear up, that all the suppliers will be able to know. It will not be inflationary because we are doing it on that basis, and we are not going to be adding more money to that deficit, which is $50 billion.
We have a deficit when we have a recession, we have a deficit when inflation starts, and we have a deficit when recovery starts. People say, "You told us we had to have a deficit because we had a recession and we had to stimulate spending." We did stimulate spending. On the Budget Committee we tried to accommodate that. Now as we try to build something to get out of that recession we are going to add more to that deficit. The very people who get hurt the most are the ones we come in here and talk about trying to protect with this kind of an arrangement.
Mr. BROOKE. Will the Senator yield?
Mr. CHILES. I yield.
Mr. BROOKE. I do not think anybody here criticizes the Budget Committee's responsibilities. Everybody knows what the Budget Committee is trying to do. We are trying to live within congressional budget limitations and congressional ceilings. I think that is good; I think that is sound. But there is a question of priorities and where do we place them.
The chairman said this is a consistent level. How can one say it is a consistent level when we are 20,000 units below the reservations of 1978 and 28,000 below 1977? Where is the consistency? I do not know where the Senator is getting his figures. He keeps saying CBO, CBO, CBO. Does CBO not have to get their information and data from HUD?
Mr. MUSKIE. CBO undertakes in every way possible to get independent figures. Of course it takes HUD data. It does not ignore the executive branch. But it has developed a capacity not only in this field but in the field of agriculture, education programs, in health, to estimate costs because that is a specific charge the Congressional Budget Act imposed upon them. They have developed an excellent capability. That has been my experience with them. I am not just picking their number for this particular program as evidence of their reliability. Their reliability has been consistent. We have checked with their numbers on the eve of the debate on the floor so that we are not relying on numbers that might have changed on the basis of more recent experience or unforeseen circumstances. We stay right on top, as close as we can, so that we have the numbers. I want that thoroughly understood.
Mr. CHILES. My friend from Massachusetts has pointed out that the question is one of priorities. I certainly concur in that.
(Mr. GRAVEL assumed the chair.)
Mr. CHILES. What the distinguished chairman of the Budget Committee has been saying, I think, is that the question of priorities should have been argued in April at the time we had the budget resolution on the floor, at the time that we were saying how much we would put in housing and how much we would put in roads and how much we would spend for education.
That is when we come in with a figure of how much we think there is going to be in revenue and how big the deficit is going to be — a $50 billion deficit. At that time is when Senators can offer amendments to say, "We think the priorities should be changed; we think there should be more money put in housing."
That was done the year before in the Budget Committee. The Budget Committee lost on an amendment that was put on to change the priorities on housing. I resisted that; I think the Budget Committee did. But we lost on that amendment because we were debating it then on the priorities.
Now, after we have established the priorities, to come in and say, "We are going to add to the budget authority," then I think it is the duty of the Budget Committee to say, "We need to resist that because it is going to break all of our targets." And how are we going to say to the next person or the next group that comes in and says "Our needs are not being met" — certainly, we are not meeting the needs of many areas.
That is why we have a Budget Committee, because we finally decided that if we were meeting the needs or trying to meet the needs of everybody, we would have a deficit every year. Because the way we spent money was, we put out an appropriation, no one added it up. At the end of the year, we sort of added up and saw how much we had appropriated, how much we were over the budget and that was the deficit. Then we started floating bonds.
Finally, we said we are going to try to do it a little better way, try to estimate, before we spend it, how much we would need to spend, what our priorities are for spending that, and so on. That is how the budget is supposed to work.
If we are going to go through that and it does not mean anything and we can come in and change that, then we might as well not have a Budget Committee or a budget process.
Mr. BROOKE. If the Senator will yield, this Senator respects the budget process. I think all Senators respect the budget process. I do not think the Senator is trying to say that we are bound in every instance by what the Budget Committee has done.
I do not know whether there was any action taken on the floor. Senator HEINZ did introduce an amendment in committee at the time this budget resolution was being considered, as I understand it.
Before the Senator responds. I just want to clarify one point, and I hope the record will show this fact. It can be corrected if we find out from the CBO that this is incorrect. HUD did not use a 6-percent inflation rate. It used an inflation rate of zero. That is how I understand that the estimate was reduced to 375,000 units. Then there was a change in housing assistance plans by localities toward more expensive new units. That reduced the figure down to 360,000 units. I hope the distinguished chairman of the Budget Committee will have that verified, because I do not want him to think that I have given him any data which is not based on fact. That is the fact as we have it. That is why I used the 360,000 unit figure rather than the 375,000 unit one.
Mr. MUSKIE. First, may I make the point that what we are talking about is not something the Budget Committee did; we are talking about a resolution the Congress of the United States adopted.
Mr. BROOKE. Yes.
Mr. MUSKIE. Second, the factors the Senator refers to as having produced the figure of 360,000 are exactly the factors used in CBO's analysis. In fact, an analysis even more comprehensive than that is done by CBO.
They are not children at this estimating business. They understand that, although the overall inflation rate was 6.5 percent, it varies and they apply this variation, giving it as much precision as possible, in calculating costs.
Finally, I say to the Senator that since he prefers HUD's position on the number of units, it is HUD that supports the numbers in the Chiles amendment. It is Secretary Harris who says this will enable them to continue their programs.
I shall read what she says in a letter dated today:
I believe that the budget requests submitted on behalf of this Department are sound and fully justified, in light of the balance which must be struck between competing national priorities and the Nation's housing needs. I have frequently stated that I shall oppose with equal vigor any efforts to disrupt that balance, either by adding to or reducing the level of funding we have requested. That continues to be my position.
Mr. BROOKE. Does the Senator know that the Secretary of HUD, Mrs. Harris, asked OMB for 600,000 units, which is the housing goal we have discussed earlier?
Mr. MUSKIE. I would expect that. The first year that the Budget Committee was in existence, Senate committees asked us for $50 billion more than we were able to provide. Of course, they make their best estimate of the needs that they think ought to be served. Then we have to strike a balance.
I am not suggesting that we are the last word as to what might be justified in any particular program; the committees are. But we have the responsibility of bringing them all together in some kind of balance. Then the conference approves or disapproves, or modifies our recommendations. We all understand that process.
Now we have come to the point where we have to discipline ourselves to meet those numbers. This is the first challenge of the year to the resolution that we adopted on May 15, just 2 months ago. We are going to have to prepare a second resolution that will have to be completed by September 15. The same constraints are going to exist, but working with a $50 billion deficit. Nobody likes it, including, I am sure, the Senator from Massachusetts. Nobody likes those numbers. So we are trying to maintain discipline. And we have to make the case.
If the Senate decides that we did not provide enough in the budget resolution, and it does not meet their purpose, then, in the Senate prerogative, it ought to change those totals. But I hope we would do so without any misapprehension as to what the resolution provides.
It was our understanding at the time that the first resolution provided full funding for continued housing programs. And may I remind the Senator that, continuing the level of funding that is in the first budget resolution, the percentage of the total Federal budget that will be devoted to assisted housing will increase by 50 percent in the next 5 years. That means it will grow faster, given the first budget resolution, than almost any other function in the budget.
Those are important numbers, because when you add 375,000 or 360,000 additional families a year, whatever that number is, you add it on top of last year's layer of additional families, and each of those layers establishes obligations for15 to 40 years, depending upon the program.
Our projections show that in 20 to 30 years, annual outlays for housing will run $30 to $40 billion.
I do not know how much good it does to try to envision those numbers, because a lot of things are going to happen — inflation and all the rest of it. Nevertheless, it gives a picture of the trend that is being established in the first budget resolution. As long as that is understood, if the Senate wants to accelerate that trend or make the curve steeper, that is the Senate's prerogative. But I want the Senate to understand where we are. That is my only responsibility.
Mr. BROOKE. I thank the Senator. Mr. President, how much time is remaining on this amendment?
The PRESIDING OFFICER. Sixteen minutes remain to the proponents and 17 minutes to the opponents.
Mr. BROOKE. Sixteen and seventeen?
The PRESIDING OFFICER. The Senator is correct.
Mr. BROOKE. I yield 5 minutes to the distinguished Senator from New York.
Mr. JAVITS. Mr. President, I rise to oppose the amendment. I have had no particular design to participate actively in this part of the debate, having other matters relating to the housing bill which I wish to attend to. I was really brought to my feet by two points.
By the way, we are not dealing with people who have any mean feelings about the poor or aged or do not want them housed properly. I think Senator MUSKIE made that very clear on both sides. We are dealing as intelligently as we can with people who have comparable motivations.
The difficulty, as I see it, is twofold. One, the point was made that we are really serving these people the best if we abate inflation, and that would do them more good than more housing.
That I cannot agree with.
Second, is the question of competing national priorities, which I shall discuss more fully later.
Well, as is popularly said, Mr. President, that is why we made erasers on pencils. If we do not do the right thing and subsequent events indicate we have not done the right thing, then our authority is to do it right.
I was one of the founders of the budget business. I was a member of that organizing group. I could not stay with it because of our rules about the number of committees one would have. I sat, however, in the original organizing meetings in which we acquired our staff, set up a budget office, and so forth.
One thing was made very clear, Mr. President, and that is that while the budget would be a discipline, it would not be a straitjacket. The Senate ultimately could work its will, depending on the equity.
That, as I see it, is the plea which Senator BROOKE is making, and Senator KENNEDY and others, that the Senate work its will depending on the equities, but bearing in mind the disciplines of the budget resolution.
I deeply believe the amendment challenging the issue is perfectly proper, but I believe it should be defeated for the reasons which I will state.
In the first place, housing is one of the key benefits, one of the key goods, that we give our elderly people and our lower income people. It is the one thing which the Government has a participation in supplying which has a direct and immediate effect upon the tranquility of their lives and their opportunity to enjoy decent and orderly lives. Therefore, our bias should be to supply it when it is needed.
There is no argument whatever with Senator BROOKE's thesis that it is needed and that to reduce it now because of the effects of inflation and of our monetary situation represents a retrogression from the degree of our progress in the past. We should not saddle it upon this particular group, unless we did it during some dire national emergency situation.
I do not see, Mr. President, when we are debating agricultural subsidies, and subsidies for ships and planes and roads and the military budget, that any of these considerations suddenly intrude. On the contrary, we argue about the merits of whether we should or should not undertake a given program. But we certainly should not argue about the fact that we are doing too much for a people who need it very urgently or too much for a situation in which we deeply believe.
Secondly, Mr. President, on the issue of inflation, I submit to my colleagues that housing is not inflationary. That is something we have been fighting around here for a long time. We have been fighting this because the bookkeeping of the United States in this regard happens to be cockeyed — and it is — unlike the bookkeeping of any business concern.
This bookkeeping says that it does not matter what your assets are. People go around tearing their hair about the national debt without ever comparing it to its proportion of the gross national product. That has been going down and down and down rather than up and up and up.
It is the same with this housing situation. We are adding to the basic and fundamental resources of a country when we build and preserve housing. Therefore, we may be spending more, but we have more.
Finally, the idea that construction is straining at the labor market or the material supply market contradicts the findings of every economist who is studying the situation, including all the banking economists.
The PRESIDING OFFICER. The Senator's time has expired.
Mr. JAVITS. One additional minute.
Mr. BROOKE. Yes.
Mr. JAVITS All agree, and we know in New York we have 20 percent unemployment in the building trades, and in most other parts of the country it is double the normal unemployment. There is no dearth whatever of raw materials in respect of housing.
For all those reasons, Mr. President, because it is desirable social policy, because it adds to the real wealth of the country, including the tranquility of its people, and because it serves an urgently necessary human need, I urge rejection of the amendment.
Mr. BROOKE. I thank my distinguished colleague.
I just want to point out to him, this whole question of cost effectiveness which we are talking about I raised before the distinguished Senator from New York came into the Chamber, that we have in public housing alone a $20 billion investment.
Mr. JAVITS. Exactly.
Mr. BROOKE. Which we have to protect. In the area of HUD-assisted housing, HUD has been selling some of those projects they acquired at 3 cents on a dollar. Three cents on a dollar. So we are losing money.
I just cannot understand why we cannot get that point across, that building housing will help this economy. It will give us additional revenues for the economy and we are protecting our substantial dual investment.
So it is not a matter of wasted money or money going into a vacuum at all. Yet time after time we have to fight for housing. I think it is the most important investment we can make.
Mr. JAVITS. Housing, health, and education are all keys to the future of this country.
Mr. BROOKE. If we have good health, people will be productive. If they are educated, they will be productive. If they have housing to live in, they will be productive, and that will return revenues.
Mr. President, are there any more speakers on this amendment?
Mr. CHILES. I am ready to yield back the remainder of my time.
Mr. BROOKE. Again, I forgot the Senator from Florida has the time on this. If the Senator from Florida is ready to yield back his time, I am ready to yield back our time. I know of no one who wants to speak so I yield back the remainder of my time.
Mr. MORGAN addressed the Chair.
The PRESIDING OFFICER. The Senator from North Carolina.
UP AMENDMENT NO. 1437
(Purpose: To reduce certain authorizations)
Mr. MORGAN. Mr. President, I send to the desk an amendment in the second degree.
The PRESIDING OFFICER. The clerk will state the amendment.
The second assistant legislative clerk read as follows:
The Senator from North Carolina (Mr. MORGAN) proposes an unprinted amendment numbered 1437.
Mr. MORGAN. Mr. President, I ask unanimous consent that further reading of the amendment be dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment is as follows:
On page 1, line 2 in lieu of the figure "$1,334,950,000" insert "$1,366,000,000".
Strike out the figure "$729,000,000" and insert "$760,000,000".
Strike out the remaining amendments, and insert in lieu thereof the following:
On page 3, lines 18 and 19, strike out "$370,000,000" each place it appears, and insert in lieu thereof "307,500,000".
On page 11, line 2, strike out "$45,000,000" and insert in lieu thereof "19,500,000".
On page 30, line 14, strike out "$75,000,000" and insert in lieu thereof "$30,000,000".
Mr. MORGAN. Mr. President, I have mixed feelings on the Chiles-Muskie amendment. I feel very strongly about the budget process. I have tried as consistently as I could through the last 2 or 3 years to support the chairman of the Budget Committee in trying to keep within the budget resolution.
The chairman, Senator MUSKIE, told me earlier that my consistency on budget issues is high. I feel very strongly about the budget process now. But I also understand the arguments of the distinguished Senator from Massachusetts (Mr. BROOKE), because I have sat on the Housing Committee for nearly 4 years. While these programs are complex, and I do not purport to know exactly how many units have been constructed and how many there will be under this amendment, I am impressed very much with the importance of all these programs.
So, in my own way, working with some of the staff, we have come up with a substitute which I hope will do not what both sides want but a substitute that I hope both sides could live with.
The Chiles-Muskie amendment, as I understand it, would delete from the budget outlay $486 million. My substitute would delete exactly the same amount of money. While, of course, it is impossible for me to state on the floor exactly the difference in budget authorizations, it is our estimate that it would be about the same.
This is what I propose, and I hope the Senate will accept it as a substitute for the Chiles amendment. In doing so, we will accommodate those who believe very strongly, as does the Senator from Massachusetts, and I hope that at the same time the Budget Committee would feel comfortable with what we would do in this amendment.
I propose in section 8 housing to make the following cuts:
The committee recommended $1.675 billion. The Chiles amendment would cut that to $1.334 billion. I propose to delete part of that cut and to put it back to $1.366 billion, which would make a total cut there of $309 million.
With respect to public housing subsidies, the committee proposed $800 million. The Chiles amendment would cut that to $729 million. I would increase this level to $760 million, somewhat of a split between the two levels.
In section 312, the rehabilitation program, the committee authorized $370 million. The Chiles amendment does not affect this program. My substitute would reduce this level to $307 million, a reduction of about $63 million.
With respect to urban homesteading, the committee authorized $43 million. The Chiles amendment does not affect this program. I would reduce urban homesteading to $19.5 million, a reduction of about $26 million.
As to the low-income rent supplement which the Chiles amendment would delete completely, the $75 million level of the committee, I would delete $49 million and leave $26 million, which I think would leave a viable program for the first year. Then, of course, Congress could, next year, discontinue or delete this program.
So what I have offered is a compromise amendment which would delete the same amount of money in authorization as the Chiles amendment, and I believe it would not do undue damage to the programs that Senator BROOKE is concerned with and on which he has spent many hours in the Banking Committee during the last 4 years.
Mr. PROXMIRE. Mr. President, will the Senator yield? ,
Mr. MORGAN. I yield.
Mr. PROXMIRE. Mr. President, I think the Senator from North Carolina has exactly the right objective, and ordinarily I would be happy to accept it. But I have trouble with two phases of this.
One is that the first part of it, the section 8 part, in which the Senator says he would provide, as I understand it, $1.366 million, compared to the Chiles $1.334 million
Mr. MORGAN. That is right.
Mr. PROXMIRE. The difficulty is that the administration level is $1.195 billion.So the difference between the Morgan proposal and the administration proposal would be about $3 billion with the run out, because this is run out over a period ranging from 10 to 40 years. It seems to me that that would be a very considerable burden that the Budget Committee and the administration really did not contemplate.
Mr. CHILES. Mr. President, will the Senator yield?
Mr. MORGAN. I yield.
Mr. CHILES. Mr. President, I ask unanimous consent to modify my amendment in line 2, to change the $1,334,950,000 to $1,195,043,000. Those are the proper figures that the administration has given us. We did not pick up their carryover, and they have given me that corrected figure. I ask unanimous consent to change that.
Mr. BROOKE. Does that cut it back further?
Mr. CHILES. No. It really carries out the intent of what we said we were doing,because of the carryover they had.
Mr. BROOKE. Mr. President, reserving the right to object, I understand that this modification would further cut funds for low-income housing.
Mr. PROXMIRE. it would put it at the same level as the administration.
Mr. BROOKE. That is not the Chiles amendment which we have been discussing for 2 hours. Now the Senator wants to submit another amendment reducing the level of funding to the administration level.
Mr. CHILES. All the figures we have talked about, units and everything else, are based on this number. That is why I am seeking the right to modify it.
Mr. BROOKE. I would hate to object to anything that the Senator from Florida would ask for, but I hope he will not press that, because this represents a further cut.
Mr. PROXMIRE. It simply would go to the bill on page 8, line 25, where the figure is $1.195 billion. That is what Senator CHILES initially expected to do; that is what he wanted. It was simply a technical mistake that he made in providing the $1.334 billion figure; $1.195 billion is in the bill, and he wants to go to that figure.
Mr. BROOKE. Is the Senator from Florida saying that it was a technical mistake of $139 million?
Mr. CHILES. Yes.
Mr. BROOKE. That is a pretty big technical mistake.
Mr. CHILES. If the Senator objects
Mr. BROOKE. No. Was that the Senator's intent?
Mr. CHILES. That was my intent. Every figure we used was based on the fact that we would use that number.
Mr. BROOKE. If that was the Senator's intent. I will not object.
The PRESIDING OFFICER. Without objection. it is so ordered.
Mr. BROOKE. I say this to the Senator from North Carolina: I think the Senator from North Carolina knows how strongly I feel about any cutback in these programs. However, I believe this amendment would distribute more equitably the burden of cuts among all the programs in the bill which are over the President's budget. Presumably, that is what the Senator from North Carolina is attempting to do by his amendment to the Chiles-Muskie amendment. Is that correct?
Mr. MORGAN. That is correct.
Mr. BROOKE. It would preserve, as I understand it, some additional section 8 and public housing units. Is that correct?
Mr. MORGAN. That is correct.
Mr. BROOKE. It seems to me that if the real basis of the Chiles-Muskie amendment is that this would be budget busting, this is an amendment that we should all accept, since it does not change the amount of the cut at all. Is that correct?
Mr. MORGAN. It does not.
Mr. BROOKE. It merely gives us a more equitable distribution.
Mr. PROXMIRE. I think that possibly we could do this, but it would mean that the Senator from North Carolina also would modify his amendment to make it $1.195 billion for the section 8 program, which is the administration's proposal.
Mr. BROOKE. I would agree with that, because if that was the spirit of the Chiles' amendment — and that is what the Senator from Florida has said, and I did not object on that basis — I think it would be only fair for the Senator from North Carolina to cut back the total figure, so that it would be the same figure but with a more equitable distribution.
Mr. MORGAN. I agree with that, and I ask unanimous consent that the amendment be so modified.
Mr. BROOKE. Then, I ask that we accept that modification. Is that agreeable?
Mr. CHILES. I have no objection to modifying his amendment.
Mr. PROXMIRE. It requires unanimous consent, because of the time limitation.
Mr. MORGAN. I ask unanimous consent for modification of the amendment as stated.
The PRESIDING OFFICER. The Senator has the right to modify his amendment.
The amendment of Mr. MORGAN, as modified, is as follows:
On page 1, line 2, in lieu of the figure "$1,195,043,000" insert "$1,366,000,000". Strike out the figure "$729,000,000" and insert "$760.000.000".
Strike out the remaining amendments, and insert in lieu thereof the following:
On page 3, lines 18 and 19, strike out "$370,000,000" each place it appears, and insert in lieu thereof "$307,500,000".
On page 11, line 2, strike out "$45,000,000" and insert in lieu thereof "$19,500,000".
On page 30, line 14, strike out "$75,000,000" and insert in lieu thereof "$30,000,000".
The PRESIDING OFFICER. The Senator has the right to modify his amendment.
Mr. MORGAN. Mr. President, I suggest the absence of a quorum and ask unanimous consent that the time not be counted and that the quorum call be for not more than 5 minutes so that I may get the amendment technically correct.
The PRESIDING OFFICER. Is there objection?
Mr. MUSKIE. Mr. President, reserving the right to object, and I shall not object, I ask the Senator is this section 8 housing and he wants to adjust his number to accommodate the number of the Chiles amendment? Will he still add $32 million to the new Chiles number? Is that his proposal?
The PRESIDING OFFICER. Is there objection to the request of the Senator from North Carolina?
Mr. CHILES. Mr. President, reserving the right to object, I am trying to understand now what the modification is.
The PRESIDING OFFICER. The Senate will be in order so we can hear what is going on. I think this matter will be more efficiently resolved if we are in order.
The Senators will withhold.
The Senator may proceed.
Mr. MORGAN. Mr. President, I suggest the absence of a quorum and ask unanimous consent that the time not be counted and that the quorum call last for a period not to exceed 5 minutes. We have a technical flaw in our amendment which we need to correct.
The PRESIDING OFFICER. Without objection, it is so ordered.
The clerk will call the roll.
The second assistant legislative clerk proceeded to call the roll.
Mr. MORGAN. Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.
The PRESIDING OFFICER. Without objection; it is so ordered.
Mr. MORGAN. Mr. President, first I ask unanimous consent that my amendment may be modified with regard to thefirst section by striking out $1,366,000,000, and inserting in lieu thereof $1,227,000,000.
The PRESIDING OFFICER. The Senator has the right to modify his amendment.
Mr. PROXMIRE. That would be above the administration level, right?
Mr. MORGAN. That would be above the administration level by $30 million.
Mr. PROXMIRE. You see the difficulty is that there is a run out, so you have to multiply by about 20 to get the full budget impact over the years.
Mr. MORGAN. That, of course, would be a debatable subject as to whether or not we would want to cut it out next year. The Congress would have the right to eliminate this program next year.
Mr. PROXMIRE. What is the Senator talking about? Is he talking about section 8?
Mr. MORGAN. Section 8 housing.
Mr. PROXMIRE. It involves a legal contract. We had a big debate in the Senate on this last year. The difficulty with this is you cannot cut off the contract. It is a commitment for as long as the program lasts. The contract has to be honored; is that not correct, Senator MUSKIE? It is my understanding that that is why we had great difficulty last year, and the Senate resolved it, in my view unfortunately, as counting this long-term run out money.
Mr. MORGAN. Suppose I get the amendment in order and then we will try to go from there.
So I ask that the amendment be modified, as I indicated.
The amendment, as further modified, is as follows:
On page 1, line 2 in lieu of the figure "$1,195,043,000" insert "$1,227,000,000." Strike out the figure "$729,000,000" and insert "$760,000,000".
Strike out the remaining amendments, and insert in lieu thereof the following:
On page 3, lines 18 and 19, strike out "$370,000,000" each place it appears, and insert in lieu thereof "$307,500,000".
On page 11, line 2, strike out "$45,000,000" and insert in lieu thereof "$19,500,000". On page 30, line 14, strike out "$75,000,-000" and insert in lieu thereof "$30,030,000".
Mr. MORGAN. Mr. President, I ask unanimous consent that my amendment, as modified, be in order, and that it also be in order that the Senator from Florida be able to offer an amendment deleting that portion with regard to low-income rent supplements.
The PRESIDING OFFICER (Mr. MATSUNAGA) . Without objection, it is so ordered.
Mr. PROXMIRE. Mr. President, if the Senator will yield, I still have a problem now with how you want your amendment to read. It is my understanding, that the run out on this would be $2 billion or more over the administration's request over the life of the contract, and there is no way it can be reached in the future, because the U.S. Government made a contract with a landlord and that contract, of course, has to be honored.
Mr. MORGAN. The life of the contract is over a period of some 10 or 12 years.
Mr. PROXMIRE. It could be up to 40 years, 40 years for maximum, but it could be 20, 30 or 40 years.
Mr. MORGAN. I am still of the opinion that the next Congress or a future Congress can reduce that level as leases terminate in order to bring the level in line.
Mr. PROXMIRE. Well, the staff disagrees with that. They say there could be some slight adjustment, but it has always been regarded as entitlement money unless, of course, we want to breach our word and say we will not keep it.
Mr. MORGAN. Let us put it this way: If the program is worthwhile, and I think it is, and I feel very strongly about it, as has been supported during the committee hearings, if the program is worth $1,195,000,000 as the President has recommended and as the whole committee recommended, $1,675,000,000, we are cutting about $400 million from what the committee did, so even if we had its effect down the road, it would be minimal in terms of what the full committee did. The budget outlay would still be within this budget resolution.
Mr. PROXMIRE. The Senator is correct. There is no question, but what it is an improvement over what the committee did, and a very marked improvement, but still substantially over the budget over the full 40-year span.
Mr. BROOKE. Mr. President, will the Senator yield?
Mr. MORGAN. I do yield.
Mr. BROOKE. I would like to ask the chairman if he would respond to my question as to how he arrived at the $2 billion figure. At maximum, it would be$32 million multipled by 40 years, and even if you ran it out to 40 years it would only amount to $1.2 billion. In addition,there is no assurance that it would run out 40 years. I do not understand how the Senator arrived at $2 billion.
Mr. PROXMIRE. As is true so often the Senator is correct. This would be $600 million, 20 times $32 million. It is still $640 million higher than the administration is requesting. I was wrong when I said $2 billion. It was a rapid calculation which was in error. I think the Senator is correct.
Mr. CHILES. I think the difference is the $2 billion figure which would be taking the maximum. I think CBO is taking the normal spendout of what they would spend. It would be around $650 million, so I think the Senator was right when he gave the outside figure and said it would be $2 billion.
Mr. BROOKE. It could not be $2 billion under any circumstances.
Mr. CHILES. If we went out to the maximum I think it could.
Mr. BROOKE. It would be $1.2 billion if you ran it out to the maximum of 40 years, but you do not compute all units at the maximum cost. That is the point I was making, and I think the Senator is conceding that point.
Mr. MORGAN. Let me say one final word, if I may, before we vote.
With regard to section 8 housing the amount of money contained in my substitute amendment is about $450 million less than what the Housing Committee said after listening to testimony many months.
On the public housing subsidies we are $140 million less than what the Housing Committee determined.
On rehabilitation we are $63 million less than what the Housing Committee determined.
On urban homesteading we are about $25 million or $26 million less.
On low-income rent supplement we are$49 million less.
So, in essence, we are now taking as much budget authority out of the housing bill as the Chiles amendment did, and we would be within the budget resolution and, at the same time, we would be funding some very badly needed programs.
The PRESIDING OFFICER. Who yields time?
Mr. CHILES. I wish to speak against the substitute. I yield myself 5 minutes.
The PRESIDING OFFICER. The Senator from Florida is recognized for 5 minutes.
Mr. CHILES. I think the substitute is a change from what we find in the committee bill. The numbers are reduced, but I would point out to the membership it is still above the budget figure. It goes over function 600 in the budget. It goes over by some $600 million, so it reaches beyond the budget figure.
In addition to that, it still creates an entirely new program for low-income assistance in FHA housing. Now, to me, we do not know what it is going to cost. We do not know how many potential recipients there can be of this program, but we can tell it creates low-income assistance for FHA housing.
What about somebody who lives in low-income veterans housing? What about somebody who has a conventional loan in low-income housing? You are not going to do anything for that person, so you are going to discriminate really between low-income people and as to who can get assistance and who cannot, and you are starting off an entirely new program.
No one knows what the potential cost of this new program can be. No one has given any figures as to how many people who are now in FHA housing would qualify for this assistance, up to 25 percent of need. We do not have any way of knowing that. So we are starting, with this authorization in this substitute, with an entirely new program that could break the bank. That is exactly what it could do. And once you start that program, and start funding it, you are going to say, "Wait a minute, we gave some of these funds; what is the need?"
We have talked about what the need is in housing. We have started in housing until we have a need, and now we are castigated because we are only funding 375,000 units a year. We are castigated on that.
What is the need going to be in FHA assistance, for those people who cannot pay? And if you start FHA assistance, are you going to be able to assist VA, or any other conventional loan?
Why should we start a program which we really have not looked at, when we do not have any idea of the potential need? That, to me, is the great danger of this substitute, but that is the path we would be treading.
You may say, "There is only $25 million in here; it does not cost anything." The whole thing we are trying to do in a budget process is discipline ourselves. What are the 5-year costs? What are the 10-year costs of what we are potentially starting?
Every program we now have, running into these tremendous figures, started at a few million dollars. That is all this will cost now, a few million dollars. But if you look down the line, to get enough to provide assistance to every needy person in FHA housing — every low income person, that is all it says — up to 25 percent of their needs, you break the bank.
That is what this would do, and I think we should defeat the substitute.
Mr. BROOKE. Mr. President, will the Senator yield?
Mr. CHILES. I ask for the yeas and nays on the amendment.
The PRESIDING OFFICER. Is there a sufficient second? There is a sufficient second.
The yeas and nays were ordered.
The PRESIDING OFFICER. The Senator from Massachusetts.
Mr. BROOKE. Mr. President, when the Senator from Florida and the Senator from Maine first introduced their amendment, it was my belief, and I think the Senate's belief, that they were primarily if not solely concerned with staying within the budget resolution. We argued that for about 2 hours. Now it appears to me that the Senator from Florida, at least, has changed his position now that the Senator from North Carolina has come in with a compromise amendment. The compromise amendment does not add anything to the budget at all, but merely more equitably distributes the money among the housing programs that are contained in this bill.
What the Senator from Florida now wants to do is to change the program that we spent the hours and days of hearings in the Housing Committee to develop. So he is going far beyond his original intent, which was to keep us within the budget.
The Senator from North Carolina has proposed a compromise which keeps us within the budget. I happen to disagree with what the Senator from North Carolina would do, because I think we need more for housing in this country today. But at least I believe that the Senator from North Carolina, in his amendment, makes a more equitable distribution of those housing funds and at the same time stays within the budget resolution.
The program that the Senator from Florida does not like is just a 1-year program. It does not carry it any further. The cost of the 1-year program is $25 million. And if the Senator from Florida does not like it he can come back and change it next year.
But what the Senator from Florida is now doing is not arguing about the budget resolution, because, under the Morgan amendment we are not budget busters. We are staying within the budget and are merely distributing the funds in a more equitable manner.
I think that is much more sound than the original Chiles amendment. Therefore, although I would not like to see us restricted to the amount of money that would be contained in the Morgan amendment, I would support the Morgan amendment as the lesser of two evils. At least it does not bust the budget, and we are all budget conscious today. Even I am budget conscious; I want the Senator from Florida to understand that.
Much as we want to do something here, we are penalizing the senior citizens and low-income people in this country, and I hope we will not do that by at least adopting the Morgan amendment, which does give them a better break insofar as the distribution of these funds is concerned, and yet stays within the budget resolution.
Mr. MUSKIE. Mr. President, we began the floor discussion—
The PRESIDING OFFICER. Who yields time to the Senator from Maine?
Mr. CHILES. I yield to the Senator from Maine.
Mr. MUSKIE. Mr. President, we began the floor discussion with the assumption that, with respect to section 8 housing, the Morgan amendment would be modified to coincide with the Chiles number.
That is not the case, and because it is not the case, the Morgan amendment adds $32 million in contract authority, which translates into annual contracts of $650 million in function 600 above the budget resolution.
In addition, on operating subsidies, further analysis of the Morgan substitute indicates that it adds $30 million in operating subsidies above the budget resolution; and for the rent supplement program, it adds $26 million above the budget resolution in that aspect.
Now, in function 450, the Morgan substitute does reduce by $8 million the section 312 rehabilitation program, and by $25 million the urban homesteading program. So those cuts bring the net budget impact to $673 million above the budget resolution.
The PRESIDING OFFICER. The time of the Senator has expired. Does the Senator from Massachusetts yield to the Senator from Maine?
Mr. MUSKIE. May I ask the Senator from Florida for a few more minutes?
Mr. CHILES. I yield such time as the Senator needs.
The PRESIDING OFFICER. It is the Senator from Massachusetts who needs to yield. All time of the Senator from Florida has expired.
Mr. PROXMIRE. Mr. President, I yield the Senator 2 minutes on the bill.
The PRESIDING OFFICER. Does the Senator yield 5 minutes on the bill?
Mr. PROXMIRE. Two minutes.
Mr. MUSKIE. Two minutes will be enough.
So there is still a budget impact, although it is substantially reduced, of course, from the committee bill. But the real hole in it is the one the Senator from Florida identified, the addition of rent supplements under the FHA program. There is absolutely no information upon which to base or project any intelligent estimate of the cost. We are opening a big door to future commitments; and to resist those pressures in the future is a monumental challenge to the Senate or to Congress. No one knows what that cost eventually will be.
These costs in the housing field are cumulative. Earlier I told the Senate that what is in the budget resolution, without these additions we are talking about, will mean, 20 or 25 years down the road, annual budget outlays for assisted housing of $30 billion to $40 billion. That is without adding these new programs.
Unfortunately, we are trying to analyze this new program in a very few minutes at the end of a long day, and I am afraid we are not going to really focus on the implications. But I make that statement in the brief 2 minutes that have been given to me, and I urge the Senate to consider it.
Mr. MORGAN. Mr. President, in just a few words, my amendment reduces the budget outlay by $595 million, and brings it within the budget resolution. Maybe not in the same categories, but that is the role of the Housing Committee. That is why we have debated this subject months and months for.
There is one program, the low-income rent supplement program, on which the Housing Committee authorized $75 billion. My amendment cuts that down to $26 million. It is a 1-year program, and can be terminated at the end of the year. And, as I say, this brings it within the budget resolution, and also gives due credit to the months and months of work of the Housing Committee.